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Judge directs Pa. tobacco fund to health coverage

By MARK SCOLFORO Associated Press

Updated:
03/05/2013 06:06:59 PM EST

HARRISBURG, Pa.—A portion of Pennsylvania's tobacco settlement proceeds must fund the defunct adultBasic health insurance program for lower-income adults or a similar plan, rather than be used to help balance the government budget or pay for teacher pensions, a judge ruled Tuesday.

Commonwealth Court Judge Dan Pellegrini, applying a previous and related court ruling, declared unconstitutional two state laws that siphoned the money away from adultBasic and Medicaid for disabled workers.

He threw out state laws passed in 2010 and 2011 that diverted funds from a landmark 1998 settlement with tobacco companies. He denied requests from those who sued that adultBasic be reinstated under court supervision and that some $200 million be reimbursed to the funds from those two years.

An attorney for House Speaker Sam Smith, R-Jefferson, who was a defendant, said Smith would seek a review, either through Commonwealth Court or to the state Supreme Court.

"If the court wants to start appropriating money, then they should resign from the bench and they should run for the Legislature," said House Republican lawyer Dave Thomas.

Lawyers for the dozens of adultBasic enrollees who challenged the laws said the decision means adultBasic, closed down by Gov. Tom Corbett shortly after he took office in 2011, should be reinstated.

One of the lawyers, David Senoff, called the decision "a great win for low-income Pennsylvanians."

"It confirms what we've been saying all along: Killing the adultBasic Care program was not only mean-spirited, it was against the law," Senoff said.

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The judge noted that Corbett's administration has said the required 30 percent portion of the tobacco money is all going to Medicaid.

Nils Frederiksen, a spokesman for the Corbett administration, said the ruling's legal and budgetary issues were under review. He declined to say if the administration would appeal.

Another defendant, Democratic state Treasurer Rob McCord, said he hoped the Corbett administration would reconsider its decision not to go along with an expansion of Medicaid under the federal Affordable Care Act.

"It's time for them to get it right for a change and act in the best interests of the people they're supposed to protect," McCord said.

"The court reaffirmed our position that these valuable programs should never have been terminated and working Pennsylvanians left without access to critical health care," Costa said.

Pellegrini wrote that tobacco money must go to adultBasic, unless the Legislature changes state law accordingly. The plaintiffs said the tobacco fund has been taking in more than $300 million a year, and 30 percent of that must go to Medicaid for disabled workers and adultBasic or something like it.

Thomas, the House Republican lawyer, said it was unclear from the decision how much funding for adultBasic would be needed to comply with the terms of Pellegrini's order. Thomas said it's not uncommon, or unconstitutional, for a law to pass that supercedes a previous law without explicitly repealing it.

Corbett said when he pulled the plug on the 41,000-enrollee adultBasic program that it was unaffordable. He and fellow Republicans in the General Assembly blamed his Democratic predecessor, Gov. Ed Rendell, for the death of adultBasic, arguing it had relied too heavily on money from health insurers, kept premiums too low and enrolled too many people to be sustainable.

AdultBasic began in 2002 for lower-income working adults who earned too much to qualify for Medicaid or were not old enough for Medicare. It covered major surgery but not dental costs or prescriptions.